Pepsi-Cola Canada Beverages has won the right to be the exclusive vendor of soft drinks and juices in Metro Toronto schools.
The contract with the Metro Toronto School Board calls for Pepsi to supply vending machines only and does not apply to drinks supplied over the counter in cafeterias.
The school board, which had been dealing with a number of beverage suppliers, issued a call for tenders after deciding to consolidate the business with one company.
Commission or fee
Ron McEachern, Pepsi president and chief executive officer, says vending machine suppliers either pay a commission, or flat fee, to place vending machines in buildings.
McEachern says in the case of the school board contract, Pepsi is paying $1.5 million over a period of three years.
The contract has been the focus of much public controversy.
Some feel once schools have opened their doors to commercial companies other deals will follow.
McEachern says there is no commercialism involved.
‘It’s not a question of introducing products that have not been there before, it is just a reduction in the number of suppliers,’ he says.
When asked whether this type of contract could lead to fast food chains opening for business in schools, McEachern said he would stay ‘100 miles away from that [question] because I’m just in the beverage business.’
He did say PepsiCo, which operates Kentucky Fried Chicken, Pizza Hut and Taco Bell, did have a number of foodservice contracts with high schools and universities in the U.S.
